Convenience Stores Post Modest Growth During Stalled Economy
BARRINGTON, Ill. -- Despite the stalled economy and continued unemployment that still plague the United States four years after the recession hit, the convenience store industry has managed to weather the storm.
According to Willard Bishop's 2012 "The Future of Food Retailing" report, the c-store channel saw modest in-store sales growth of 2.4 percent in 2011. Its basic emphasis on convenience may be the driving factor behind its ability to survive the economic downturn.
"This industry's emphasis on accessibility and easy transaction has helped it stay strong through the recession," the report noted.
Other food retailers that experienced good performance in 2011 included fresh-format and limited-assortment stores. Specifically, fresh-format registered sales growth of 11.4 percent to reach $10.4 billion in 2011, according to the report, and limited-assortment stores experienced a 5.6-percent increase in sales.
Traditional supermarkets, on the other hand, have been struggling a bit. Despite a 4.4.-percent sales increase in 2011, the number of grocery stores decreased by 1 percent, according to Willard Bishop.
"Traditional supermarkets have had difficulty recovering from the recession and continue to lose market share as consumers reduce their spending, search for lower prices, or shift their stock trips to limited-assortment stores, supercenters and even wholesale clubs," the report cited.
Looking ahead five years, the Willard Bishop report predicts that convenience stores will continue their strong showing. Specifically, the report said c-store sales will increase at a modest annual growth rate of 2.3 percent for locations with gas, and 1.9 percent for locations without gas. In addition, market share will rise slightly from 12.9 percent in 2011 to 13.4 percent by 2016 for c-stores with gas.
"By 2016, market share for traditional grocery will decrease 1.4 percent points to 45.3 percent, while share for non-traditional grocery will increase to 39 percent and convenience store share will increase to 15.6 percent," the report explained. "Market share will increase for both fresh-format and limited-assortment stores by 2016 to 13 percent and 3.7 percent, respectively."